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S1369................................................by JUDICIARY AND RULES
JUDGMENTS - INTEREST RATE - Amends existing law to provide a minimum legal
rate of interest on money due on the judgment of any competent court or
tribunal.
02/16 Senate intro - 1st rdg - to printing
02/17 Rpt prt - to Jud
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-seventh Legislature Second Regular Session - 2004
IN THE SENATE
SENATE BILL NO. 1369
BY JUDICIARY AND RULES COMMITTEE
1 AN ACT
2 RELATING TO THE LEGAL RATE OF INTEREST; AMENDING SECTION 28-22-104, IDAHO
3 CODE, TO PROVIDE FOR A MINIMUM LEGAL RATE OF INTEREST ON MONEY DUE ON THE
4 JUDGMENT OF ANY COMPETENT COURT OR TRIBUNAL BEGINNING ON JULY 1, 2004.
5 Be It Enacted by the Legislature of the State of Idaho:
6 SECTION 1. That Section 28-22-104, Idaho Code, be, and the same is hereby
7 amended to read as follows:
8 28-22-104. LEGAL RATE OF INTEREST. (1) When there is no express contract
9 in writing fixing a different rate of interest, interest is allowed at the
10 rate of twelve cents (12ยข) on the hundred by the year on:
11 1. Money due by express contract.
12 2. Money after the same becomes due.
13 3. Money lent.
14 4. Money received to the use of another and retained beyond a reasonable
15 time without the owner's consent, express or implied.
16 5. Money due on the settlement of mutual accounts from the date the bal-
17 ance is ascertained.
18 6. Money due upon open accounts after three (3) months from the date of
19 the last item.
20 (2) The legal rate of interest on money due on the judgment of any compe-
21 tent court or tribunal shall be the rate of five percent (5%) plus the base
22 rate in effect at the time of entry of the judgment. The base rate shall be
23 determined on July 1 of each year by the Idaho state treasurer and shall be
24 the weekly average yield on United States treasury securities as adjusted to a
25 constant maturity of one (1) year and rounded up to the nearest one-eighth
26 percent (1/8%). The base rate shall be determined by the Idaho state treasurer
27 utilizing the published interest rates during the second week in June of the
28 year in which such interest is being calculated. Provided however, that begin-
29 ning on July 1, 2004, the legal rate of interest pursuant to this subsection
30 shall be no less than ten percent (10%) per annum. The legal rate of interest
31 as announced by the treasurer on July 1 of each year shall operate as the rate
32 applying for the succeeding twelve (12) months to all judgments declared dur-
33 ing such succeeding twelve (12) month period. The payment of interest and
34 principal on each judgment shall be calculated according to a three hundred
35 sixty-five (365) day year.
STATEMENT OF PURPOSE
RS 13796
The statutory judgement interest rate historically has had a
variety of different standards. For many years the judgement
interest rate was 18% per year. The legal rate has been on a
floating rate for many years. At the time of the establishment of
the standard the judgement interest rate had always been an
additional encouragement to satisfy judgements. Today in light of
the current treasury security rate the interest rate is quite
small. The purpose of this legislation is to put a floor on
judgement interest rates of 10%.
FISCAL IMPACT
No fiscal impact.
Contact
Name: Senator Bart M. Davis
Phone: (208) 332-1305
STATEMENT OF PURPOSE/FISCAL NOTE S 1369